Rudram builders, a registered partnership firm, Secunderabad rep, by one of its partners Laxmikanth C. Seth v. Asharafuddin (died) and not necessary
2011-02-11
N.R.L.NAGESWARA RAO
body2011
DigiLaw.ai
Judgment :- 1. The plaintiff in O.S. No. 549 of 1993 on the file of I Additional Senior Civil Judge, Ranga Reddy District, at L.B.Nagar, Hyderabad, is the appellant. The suit was filed for specific performance of contract of sale dated 07.10.1987. 2. The case of the plaintiff is that the 1st defendant is the father of defendant Nos.2 to 5. The 1st defendant is the owner of agricultural lands admeasuring Ac.08.05 guntas in S.Nos.1120/1 and 1120/2, situated at Medchal village, Medchal Talug/Mandal, Ranga Reddy District, having inherited the same from his ancestors. The revenue records show the name of the 1st defendant as Pattedar of the property. The plaintiff submits that the 1st defendant, on 05.02.1987, offered to sell Ac. 13.05 guntas of agricultural land in S.Nos.1120/1, 1120/2, 1113 and 1114/1, situated at Medchal village at the rate of Rs.70,000/- per acre. Defendant Nos.2 to 5 were also requested to join in execution of the documents. However, it was subsequently found that there is a litigation in respect of the land in S. Nos. 1113 and 1114/1. Therefore, the plaintiff had given up the land covered by the said survey numbers and an agreement of sale was executed on 07.10.1989 in respect of the land bearing S. Nos. 1120/1 and 1120/2, totally admeasuring Ac.08.05 guntas. The rate agreed to was Rs.75,000/- per acre and the defendants collected a sum of Rs.2,50,000/-by way of advance and earnest money. The plaintiff filed the agreement of sale dated 07.10.1987 in original. The defendants executed a sale deed in respect of Ac.03.00 guntas of land on 16.10.1937 in part performance of the agreement of sale. The defendants promised to execute the sale deed for the remaining property at a subsequent date. As per the agreement of sale the defendants were to produce the registered release deed from Katruka Shareholders, who are the sisters of the 1st defendant releasing their undivided share in the property in favour of the plaintiff, clearance certificate from Land Mortgage Bank in respect of the loan obtained by the defendants mortgaging the schedule land and also clearance of land revenue dues. However, in spite of repeated requests the defendants did not comply with their part of the obligation. But, the plaintiff made further payments of sale consideration totaling to Rs.3,64,341/- leaving a balance of Rs.10,660/-.
However, in spite of repeated requests the defendants did not comply with their part of the obligation. But, the plaintiff made further payments of sale consideration totaling to Rs.3,64,341/- leaving a balance of Rs.10,660/-. On 22.05.1988, the 3rd defendant sent an agreement and that the agreement has been cancelled. To the said notice the plaintiff got a reply sent on 28.05.1988. On 01.08.1989. Smt.Qamarunnisa Begum, the sister of the 1st defendant, got a notice issued addressed to the 1st defendant as well as to the plaintiff claiming right over the property. On 18.03.1992, the 3rd defendant, on behalf of the defendants, sent a letter confirming and ratifying the agreement dated 07.10.1987 and also receipt of the amounts from the plaintiff towards sale consideration. On the said date, defendants collected a sum of Rs.5,000/-. The defendant were called upon even a that stage to produce clearance which they failed to do so. The plaintiff has been patiently waiting for the defendants to get clearance and register the sale deed in respect of Ac.05.05 guntas of land as per the agreement of sale dated 07.10.1987. The plaintiff has been always ready and willing to perform his part of the obligation by paying the agreed sale consideration and getting the document registered. However, the matter was postponed on account of the defendants only. 3. The 1st defendant died and the legal representatives were brought on record. The 3rd defendant filed written statement admitting the relationship with the other defendants and the ownership of the schedule properties. The fact that an extent of Ac. 13.05 guntas of land was agreed to be sold by the 1st defendant and execution of agreement on 05.02.1987 and on 07.10.1987 are admitted. The execution of registered sale deed for an extent of Ac.03.00 guntas on 16.10.1987 is admitted. As per the agreement dated 07.10.1987, a registered lese deed has to be given to the plaintiff from katruka shareholders and one Qamarunnisa Begum, the sister of the 1st defendant, issued a notice claiming share in the properties. As the plaintiff has approached the 1st defendant and as the matter is settled with the other sharers, the sale deed for Ac.03.00 guntas was registered for a consideration of Rs.2,50,000/-. The plaintiff promised to pay this balance of sale consideration and subsequently paid only a sum of Rs.40,000/-and could not pay the remaining amount.
As the plaintiff has approached the 1st defendant and as the matter is settled with the other sharers, the sale deed for Ac.03.00 guntas was registered for a consideration of Rs.2,50,000/-. The plaintiff promised to pay this balance of sale consideration and subsequently paid only a sum of Rs.40,000/-and could not pay the remaining amount. The plaintiff never insisted for production of documents referred in the agreement dated 07.10.1987 after registering Ac.03.00 guntas of land in favour of the plaintiff, whenever came forward to fulfill the terms and conditions of agreement of sale, more particularly clause Nos.3 and 4. On repeated requests made to the plaintiff, the plaintiff paid an amount of Rs.40,000/- to the defendants which is the above mentioned amount on the following dates i.e. an amount of Rs.10,000/- on 09.02.1988 and Rs.10,000/- on 06.04.1988. The amount which has been paid on 06.04.1988 was the last payment by the plaintiff and after that the plaintiff has not paid any amount to the defendants and the same has been admitted by the plaintiff in the reply notice dated 28.05.1988. The plaintiff, in all, has paid an amount of Rs.2,90,000/- to the defendants i.e. Rs.2,50,000/- paid on the date of agreement of sale and Rs.40,000/- paid on four various dates which is already mentioned above. The receipts filed by the plaintiff for the remaining amount are false and the signatures on the said receipts are forged by the plaintiff. The defendants have not received any amount from the plaintiff except the above mentioned amount i.e. in total Rs.2,90,000/-. The plaintiff with a mala fide intention in order to grab the suit land created the forgery receipts for which the defendants are taking legal steps against the plaintiff regarding forgery of signatures under civil and criminal law. The defendants, several times, requested the plaintiff to come forward and fulfill the terms and conditions of the agreement, but the plaintiff didn’t come forward, as such, after expiry of the stipulated time period of agreement of sale, the defendants have got issued a legal notice to the plaintiff on 22.05.1989 cancelling the agreement of sale. As such, the allegation made by the plaintiff that he paid further payments of sale consideration of Rs.3,64,341/-leaving a balance of Rs.10,660/- is absolutely false and hence denied.
As such, the allegation made by the plaintiff that he paid further payments of sale consideration of Rs.3,64,341/-leaving a balance of Rs.10,660/- is absolutely false and hence denied. It is true that to a reply given by the plaintiff to the notice dated 22.05.1989, Smt.Qamarrunissa Begum got issued a legal notice to the plaintiff and to the 1st defendant claiming the right over the property. It is absolutely false to say that the 3rd defendant has collected a sum of Rs.5000/- from the plaintiff. The allegation of the plaintiff that the defendants were called upon even at that alleged stage to produce the clearance is also absolutely false. The agreement of sale is cancelled on account of the plaintiff’s altitude in not complying with the terms and conditions only, but not on account of the defendants as alleged by the plaintiff. 4. On the basis of the above pleadings, the following issues have been framed for trial. (i) Whether the plaintiff paid Rs.3,64,341/- to the defendants apart from Rs.2,50,000/- as averred in the plaint towards the consideration leaving balance of Rs.10,660/- only? (ii) Whether the plaintiff is entitled to specific performance of agreement of sale and in alternative for recovery of Rs.3,84,375/- liquidated damages with interest as claimed? (iii) To what relief? 5. On behalf of the plaintiff, PW-1 was examined and Exs.A1 to A61 were marked. On behalf of the defendants, DW1 was examined and no documents were market. After considering the evidence on record, the learned I Additional Senior Civil Judge decreed the suit for refund of consideration of Rs.65,000/-and dismissed the claim for specific performance. Aggrieved by the said judgment, the present appeal is filed. 6. While the appeal was pending, C.M.P. No.8516 of 2001 was filed, and this Court has granted interim injunction restraining the respondents from alienating the property or creating encumbrances. While the matter stood thus, on 14.07.2003, respondent Nos.3 to 7 executed an agreement of sale-cum-G.P.A. in favour of one V. Suresh Rao with regard to the part of the schedule property and V Suresh Rao, on 15.07.2003, executed sale deed in favour of respondent Nos.9 to 12 on 15.07.2003 on the basis of the above G.P.A. On 16.09.2005, the 4th respondent ratified the sale in favour of respondent Nos.9 to 12 and on 06.01.2006, the 4th respondent cancelled the agreement of sale-cum-G.P.A. with V. Suresh Rao.
Subsequently, others also cancelled the G.P.A. in favour of V. Suresh Rao. On 28.01.2006, the plaintiff executed a registered sale deed in favour of the 8th respondent for an extent of Ac.03.00 guntas and on 31.07.2009, the appellants and respondent Nos.1 to 7 through their G.P.A., who is the 3rd respondent, executed a sale deed in favour of the 8th respondent for the suit extent of land Ac.05.05 guntas. 7. On the basis of the above transactions, respondent Nos.8 to 12 came on record. Subsequently, the 8th respondent filed an application in A.S.M.P. No.169 of 2011 seeking to transpose him as an appellant. I.A. No.1170 of 2010 was filed to receive additional evidence about the transactions in favour of the 8th respondent. I.A. No.2269 of 2010 was filed by the 8th respondent to receive other documents executed by respondent Nos.3 to 7. I.A.No.2158 of 2010 was filed by the appellant to declare the registered sale deed in favour of respondent Nos.9 to 12 as null and void. 8. The points that arise for consideration are: (i) Whether the plaintiff is entitled to the specific performance of the contract? (ii) Whether the 8th respondent can be transposed as appellant? (iii) Whether the alienations in favour of respondent Nos.9 to 12 can be declared as null and void? POINTS:- 9. This being a suit for specific performance of the contract and the lower Court having refused the specific performance exercising its discretion, it is for the plaintiff-appellant to show as to how the reasoning given by the learned I Additional Senior Civil Judge is not tenable and as to how this Court should substitute its discretion. It is also further to be proved by the appellant that he has got subsisting right of seeking specific performance of contract of sale. In fact, it is well settled law that a simple suit for specific performance cannot be converted into a suit for title to decide the interest of the parties who claim to be subsequent purchasers on applying the principle of its pendence or when the transactions are said to be fraudulent. The scope of determination of relief of specific performance is only limited to the right of the plaintiff and the enforceability against the defendants. 10.
The scope of determination of relief of specific performance is only limited to the right of the plaintiff and the enforceability against the defendants. 10. It is needless to say that the law is well settled that a person seeking a relief of specific performance should show that his conduct is clean and fair. It is also to be shown that at all times, he was intending to perform the contract and there shall be no undue advantage to the plaintiff. The lower Court has refused to decree the suit of the plaintiff on the ground that the payments pleaded by the plaintiff under Exs.A36 to A59 are not true and the payments being fabricated, the equitable relief of specific performance cannot be granted. 11. Before appreciating the contentions of the learned counsel for the appellant about the tenability of the findings of the lower Court, some facts have to be taken note of. Evidently, the suit agreement was originally entered into on 07.10.1987 for the sale of Ac.08.05 guntas of land at the rate of Rs.75,000/-per acre and by 16.10.1987 Ac.03.00 guntas of land was available under registered sale deed and a sum of Rs.2,50,000/-was paid as earnest money. Thereafter, if the conduct of the plaintiff is to be taken into consideration, the payment as reflected under Exs.A16 to A60 till 1992 shows that as if some installments were paid as if towards the discharge of debt and not as a consideration for the purchase of the property. When the property was purchased at the rate of Rs.75,000/- per acre and only Rs.3,50,000/-is payable towards balance of sale consideration and any person who is interested in specific performance must prove his readiness and willingness to pay the amount substantially. One fails to understand as to how monthly payments or periodical payments in thousands are given and receipts were obtained. This clearly goes to show that the plaintiff was not offering the entire sale consideration at one time and his preparedness and willingness to pay the amount and get the registered sale deed executed in his favour and thereby disentitling himself for the discretionary relief.
This clearly goes to show that the plaintiff was not offering the entire sale consideration at one time and his preparedness and willingness to pay the amount and get the registered sale deed executed in his favour and thereby disentitling himself for the discretionary relief. The sale of the properties for a price is for better investment or in the hope of purchasing other properties, when the values of the land are increasing and particularly so, where the suit lands are situated, the payment of consideration as a pittance at irregular intervals as if some mercy is shown on the vendors, does not show the bona fides of the plaintiff and it is highly inequitable to grant relief of specific performance in favour of the plaintiff since the plaintiff will have better advantage and vendor will be looser. 12. The law is well settled that when a party to an agreement abandons the contract, and comes into terms with the vendor, he cannot seek a relief of specific performance. In this case, during the pendency of the appeal, it is clear that the plaintiff along with the defendants executed a sale deed in favour of the 8th respondent for consideration. Therefore, it clearly goes to show that the 1st plaintiff was not interested in seeking a specific performance relief on the basis of the contract and on the other hand, he accepted the title of the vendor and abandoned his right of the contract and joined in execution of the sale deed. Even if it is not a case of abandonment, it clearly goes to show that he got relief from the vendor and no further relief of specific performance against the vendor is open and not available. Therefore, these circumstances also clearly disentitle the plaintiff for the relief of specific performance. 13. Added to that the lower Court which has considered all the documents with reference to the admitted documents and on appreciation of the evidence, came to the conclusion that the payments under Exs.A36 to A59 cannot be considered. As can be seen from these documents, it is quite clear that there is any amount of doubt about their genuineness. The lower Court has rightly rejected the same. When these payments were made there is no reason as to why any endorsement was not taken on the agreement to enforce the same.
As can be seen from these documents, it is quite clear that there is any amount of doubt about their genuineness. The lower Court has rightly rejected the same. When these payments were made there is no reason as to why any endorsement was not taken on the agreement to enforce the same. Therefore, I find that the relief of specific performance to be considered in this appeal has become infructuous and the plaintiff has no right to seek any specific performancesince he had already joined with the vendor and executed a sale deed in favour of the 8th respondent. The conduct of plaintiff is not bona fide before suit or after suit. 14. The matter does not stop there since it is a case where the plaintiff and the defendants along with their properties are trying to pay a game in the Court and ultimately. Being parties to fraud and violation, seek the assistance of the Court for determination of the issues which are beyond the consideration in the suit. 15. It is the contention of the appellant supported by the 8th respondent that there is an injunction order against the respondents from alienating the property and that order dated 24.04.2001 was violated and the defendants have alienated the properties in favour of respondent Nos.9 to 12, and therefore, they are not valid. 16. Strong reliance is placed on the judgments reported in Tayabbhai M. Bagasarwalla v. Hind Rubber Industries Pvt. Ltd. ( AIR 1997 SC 1240 ), Patel Rajnikant Dhulabhai v. Patel Chandrakant Dhulabhai ( AIR 2008 SC 3016 ), D.D.A. vs. Skipper Construction Co.(P) Ltd ( (1996) 4 SCC 622 ), and Food Corporation of India vs. Sukh Deo Prasad ( (2009) 5 SCC 665 ) by the learned counsel for the 8th respondent. These are the cases where in an application for punishment for disobedience of the orders dealt with under Section 39-A of C.P.C., the Courts held that when there is disobedience, a person can be punished. Those decisions do not deal with the situation as in this case. The learned counsel also further relied on a decision reported in Surjit Singh and Others v. Harbans Singh and Others ( (1995) 6 SCC 50 ) whereunder an assignment was also cancelled for violation of undertaking.
Those decisions do not deal with the situation as in this case. The learned counsel also further relied on a decision reported in Surjit Singh and Others v. Harbans Singh and Others ( (1995) 6 SCC 50 ) whereunder an assignment was also cancelled for violation of undertaking. Based on the above contentions, the learned counsel for the 8th respondent contends that there is a grave contempt committed by the respondents, and therefore, the alienations made by them have to be set aside and the 8th respondent cannot be directed to go to another Court to establish the right. He also relied on a decision in Kiran Tandon vs. Allahabad Development Authority and another ( AIR 2004 SC 2006 (1)), about his right to transpose as an appellate. The above decisions clearly show that the violation cannot be taken into consideration easily and the law requires a check on such attitude of the parties. 17. However, in this case, the situation is otherwise. It is to be mentioned that an order of injunction in a pending suit binds all the parties. When an injunction is granted against the respondents from alienating the property, it does not mean that the petitioner has got right to alienate the properties. The performance of an injunction is to see that the rights of the parties are continued till the disposal of the suit. This being a suit for specific performance, evidently, the plaintiff will not get any right in the property till his rights for specific performance is granted and decreed. However, the appellant and the 8th respondent, having colluded with the defendants, have brought into existence the sale deed dated 31.07.2009. It is quite clear that it is the appellant that has violated the order of injunction. Nobody knows under what authority along with the defendants. He has executed the sale deed in favour of the 8th respondent. If there is any contemnor, he should be punished first along with the defendant for alienating the property and it can be taken as an abetment for contempt by the appellant. It is a clear case where having committed foul, the appellant is calling others to be punished. 18. In this connection, it is to be noted that the law on this aspect is no longer in doubt. In Guruswamy Nadar Vs.
It is a clear case where having committed foul, the appellant is calling others to be punished. 18. In this connection, it is to be noted that the law on this aspect is no longer in doubt. In Guruswamy Nadar Vs. P.Lakshmi Ammi(AIR 2008 SUPREME COURT 2650) it was held that when an agreement of sale or a sale transaction has taken place after the institution of the suit, it is hit by the principles of lis pendens and even the question of bona fide purchase for consideration which can be claimed under Section 19(b) of the Specific Relief Act, 1963 cannot be accepted. It is useful to refer to the following observation of the Hon’ble Supreme Court. “Normally as a public policy once a suit has been filed pertaining to any subject mater of the property, in order to put an end to such kind of litigation, the principles of lis pendens has been evolved so that the litigation may finally terminate without intervention of a third party. This is because of public policy otherwise no litigation will come to an end. Therefore, in order to discourage that same subject-matter of property being subjected to subsequent sale to a third person, this kind of transaction is to be checked. Otherwise, litigation will never come to an end.” 19. The same effect is in another decision reported in Ramesh Chandra Patnaik Vs. Pushpendra Kumari and Others [(2008) 10 Supreme Court Cases 708]. 20. With regard to question of title set up by the third parties is concerned, it is useful to refer to a decision reported in Bharat Karsondas Thakkar Vs. M/s. Kiran Construction Co. & Ors (AIR 2008 SUPREME COURT 2134). When the amendment of a suit for specific performance substantially changes the nature and character of the original suit, it is not permissible. The above decision refers to the decision reported in Kasturi Vs. Iyyamperumal and others (AIR 2005 SUPREME COURT 2813) under which the broad principles of the scope of determination of a suit for specific performance and addition of the parties was considered.
The above decision refers to the decision reported in Kasturi Vs. Iyyamperumal and others (AIR 2005 SUPREME COURT 2813) under which the broad principles of the scope of determination of a suit for specific performance and addition of the parties was considered. Further, the Hon’ble Supreme Court observed as under:- “In a suit for specific performance of a contract for sale, the issue to be decided is the enforceability of the contract entered into between the appellant-purchaser and the respondent-vendor and whether contract was executed by the appellant and the respondent for sale of the contracted property, whether the plaintiffs were ready and willing to perform their part of the contract and whether the appellant is entitled to a decree for specific performance of contract for sale against the respondent. It is an admitted position that the third party or stranger to contract did not seek their addition in the suit on the strength of the contract in respect of which the suit for specific performance of the contract for sale has been filed. Admittedly, they based their claim on independent title and possession of the contracted property. It is, therefore, obvious that in the event, they are added or impleaded in the suit, the scope of the suit for specific performance of the contract for sale shall be enlarged from the suit for specific performance to a suit for title and possession which is not permissible in law. Therefore, a third party or a stranger to the contract cannot be added so as to convert a suit of one character into a suit of different character. This addition, if allowed, would lead to a complicated litigation by which the trial and decision of serious questions which are totally outside the scope of the suit would have to be gone into. As the decree of a suit for specific performance of the contract for sale, if passed, cannot, at all, affect the right, title and interest of the third party in respect of the contracted property they would not at all, be necessary to be added in the suit for specific performance of the contract for sale.
As the decree of a suit for specific performance of the contract for sale, if passed, cannot, at all, affect the right, title and interest of the third party in respect of the contracted property they would not at all, be necessary to be added in the suit for specific performance of the contract for sale. Moreover, the appellant, who has filed the present suit for specific performance of the contract for sale is dominus illus and cannot be forced to add parties against whom he does not want to fight unless it is a compulsion of the rule of law.” 21. Therefore, from the above decision, it is quite clear inter se disputes between the third parties who claim to have purchased from the same vendor, cannot be decided in a suit for specific performance. It is, therefore, quite clear that respondent Nos.8 to 12 are not at all necessary parties and their transactions are hit under the principles of lis pendens. Therefore, the contentions raised by the appellant, supported by respondent No.8 are beyond consideration and the scope of the suit and appellant having himself committed the contempt cannot pled that the alienations in favour of respondent Nos.9 to 12 have to be set aside. It is left to the parties to decide their rights in a separate proceeding and in the suit for specific performance, the parties cannot be permitted to create a platform for settlement of issues arising out of the illegal activities. Therefore, I have no hesitation in holding that the conduct of all the parties deserves to be deprecated and all of them are trying to take chances with the process of law and court. Accordingly, the points are answered. 22. In the result, all the application in A.S.M.P. Nos.1170 & 2269 of 2010 and 169 of 2011 and Appeal Suit deserve to be dismissed, and accordingly, they are dismissed. Each party shall bear their own costs.